Look, I understand why influential people are reluctant to admit that policy ideas they thought reflected deep wisdom actually amounted to utter, destructive folly. But it’s time to put delusional beliefs about the virtues of austerity in a depressed economy behind us.

It is this blog’s overarching conceit that none do more harm than those who seek to do a principled good. The selfish will always accept a Coasian bargain. True believers will stop at nothing.

Why? Why on EARTH should we allow the economic equivalent of flat-earthers to “keep their faith”? Their misguided “faith” has been DESTROYING this country for over three decades – until they and their financial backers are utterly discredited and shamed out of the profession any sort of recovery is temporary at best.

Would you advise AA to allow an alcoholic who believed that booze gave them superpowers to “keep his faith”? One would hope not…

From a member of AA: AA does not “allow” (or forbid) drinking or any belief about booze. It does offer a program of recovery for anyone to use to whatever extent they choose to help them to recover from alcoholism.

“Going forward, we oughtn’t confine ourselves to making the best of a terrible ideological environment. We should be considering how we might alter that environment to be more conducive of good policy.”

“Karl Smith, if I understand him, thinks that I should refrain from pointing out how foolish and destructive foolishly destructive ideas have been, and offer the proponents of these ideas a face-saving exit.”

Is that really what Karl Smith is trying to say? If so, quoting Lincoln is a funny way of making the point. Lincoln repeatedly told his generals that the only acceptable outcome to the civil war was a rebel surrender.

No ideology is going to be able to take us forward. The only way to move forward in stability and prosperity is to allow the emergence of wealth that utilizes knowledge as the first prior, alongside the economies that utilize money as the first prior. Knowledge was the first driver of prosperity, and it has the chance to save our asses in the near future, if we only measure it in ways that do not diminish its worth. The knowledge prior recognizes knowledge as a seed for growth, rather than a graft of the previous growth. By so doing it is able to capture the entire process of growth and treat knowledge wealth as the journey it once was, rather than the empty destination it has become.

The writer you’re criticizing here is not a party to any bargaining, so how is this advice useful to him or us? What power does he have beyond the power of his pen? People with power to make and break a bargain can profit by finding ways for their opponents to save face, but I’m not aware that Krugman has any such power.

Is economics supposed to be like modern ecumenical religion, where everyone is entitled to his own fairy tales about how things work? Actually, the ruling classes have put in practice their own pre-Keynesian economic belief-set and try to suppress any other views.

You make the mistake of assuming that the ‘other’ side wants to better our society as a whole. That is NOT their goal, and so the ideas put out by their hacks are just ‘dog whistles’ to uneducated folks. The ‘other’ side’s goal is to retain their existing wealth, and increase it by removing unions from our society and by creating a permanent unemployed class, ready to work for low wages. They don’t come out and say this for obvious reasons.

Thank you Mr. Hurley. This needs to be underscored. The biggest weakness of Krugman is that he is willfully blind to the fact that the richest few are very happy with the economic crisis.

He constantly talks about pundits wanting to appear “serious” or other weird pop psychology. The fact is that there is a determined group who want to undo every gain of the working class. And will stop at nothing to achieve this goal.

That the snake oil that a large number of people have been peddling be exposed as such is an important issue, whether any of the snake oil salesmen individually get to save face while abandoning it is not.

Once an idea is discredited, enough people will abandon it all by themselves, and act as if they had never believed nor pushed it all along. This is already starting with people like Nial Ferguson and many others.

What you’re suggesting is something along the lines of “well, of course everyone who was serious thought that invading Iraq was a good idea… at the time” rather than pointing out that not everyone agreed, and those who didn’t were right. The former leads to the kind of self-delusion that allows us to stumble into another disaster, like oh, I don’t know, a war with Iran. The latter, were it actually carried out forcefully in our national conversation, would lead to actually learning our lesson and possibly avoiding such folly in the future.

Those who were committed to zombie ideas that refuse to die will jump to something more fashionable once the zombies are discredited enough. You don’t have to coddle them, they’ll save themselves.

With the mention of Iraq I’m reminded of that someone in Krugman’s same institutional position who got away with being a Very Serious Person for quite a long time.

But, because of his repeated narcissistic gaffes on the utter rightness of the war despite the absence of WMD, he opened himself up to relentless — and often quite virulent — criticism in the blogosphere. In consequence, despite his many subsequent attempts to cover his tracks and reinvent himself, does anyone ever read Tom Friedman anymore except for laughs?

Indeed, self-promoting Tom is the Niall Ferguson of foreign policy punditry. And Ferguson is, of course, the Tom Friedman of economic punditry.

[…] { $("PushDown").hide(); } } // February 20, 2012, 8:22 amStraight Talk and Shifting WindowsKarl Smith, if I understand him, thinks that I should refrain from pointing out how foolish and destructive […]

[…] Karl Smith, if I understand him, thinks that I should refrain from pointing out how foolish and destructive foolishly destructive ideas have been, and offer the proponents of these ideas a face-saving exit. […]

To all here who do not want any political peace: Think that while the clash of ideas among political parties continues, the potential fate of the world only worsens. When we have no job, it does not help us that it only becomes harder for anyone to give us a job. When too many of us do not have a job and no way to survive, all bets are off. Think for a moment of those who have already been left behind, and continue to be left behind to even a greater degree, as you struggle to make the barriers of economic entry even higher. The poor want the same world you do, a world that grew great from the use of knowledge and technology. The poor, for the life of them, do not understand why you do not want them to be a part of it. Can you please explain? Your fight may never end, it is true. All the more reason to look beyond money and find ways for the poor to survive. Now. Quite blaming it on each other because we will only end up like Greece.

It is much more complicated than that. Nobody has won any war as in Lincoln’s time. You cannot give up a fight when you are still being bombarded by shells.

They can keep their faith, they just cannot impose it upon us. Don’t reverse the cause and effect. Faith doesn’t require an outward imposition upon others your desires.

They haven’t conceded anything. The problem with the discourse is that criticism of leaders receives the same audience as discussion among people that don’t understand the argument. The leaders need to concede. Nobody is intentionally attacking the followers.

It is fine to give them a path out, but that path should include a retraction of the damage in very clear terms.

Krugman and this blog’s commenters have already exposed the historical nonsense of Karl Smith’s position as well as its sappiness. So that’s no longer necessary.

But I’d like to make this point: What’s at stake here are not the delicate egos of a handful of austerian economists and misguided policymakers who won’t admit the evidence conclusively proves them wrong. What’s at stake is the wellbeing of hundreds of millions of U.S. and European citizens who are suffering because these miscreants cling to their false “faith.”

Have we so soon forgot the horrific human damage wreaked by faithful Marxist-Leninist economists and true-believing policymakers?

False faith must be vanquished and eradicated from academia, political capitals, and the blogosphere. Karl Smith’s mewing is part of the problem, not part of the solution.

Let’s take a clean slate approach here then. The German position is first that the CB neutralizes the demand side effects of austerity. Second, fiscal policy and regulatory policy has a role in the shape of the SRAS curve. The goal in austerity are reforms of the public sector that enhance output.

Krugman’s response to this (and I hesitate to speak for him) would be simple, I believe. He would say “Show me the results.” Shall we look at the success – right – of austerity in England or perhaps Ireland? The German position is not for success for all, but to eliminate ANY inflation.

It can be uncomfortable sitting in a department chalk full (or even partly full) of denialists—of evolution, climate change and Keynesian economics. This is especially true for younger to mid-career faculty.

It takes unblinking courage, but standing up to these clowns is the right thing to do. Krugman is doing a fine job of it and he should be commended. And he could really use unadulterated support from people like you.

[…] Karl Smith: It is this blog’s overarching conceit that none do more harm than those who seek to do a principled good. The selfish will always accept a Coasian bargain. True believers will stop at nothing. Share this:EmailFacebookTwitterRedditStumbleUponLike this:LikeBe the first to like this post. […]

Krugman’s response? Sure, but only after we burn Atlanta to the ground.

“Karl first quotes Lincoln’s words about malice towards none, charity for all. Lovely words indeed. But the Second Inaugural was delivered after Sherman had laid waste to Georgia and South Carolina, ripping out the heart of the Confederate economy; Grant was about to be joined by Sheridan, who had just done the same to the Shenandoah Valley, giving him overwhelming superiority over Lee. If and when austerian ideology is in a state similar to that of Confederate war prospects in early 1865, I promise to be equally magnanimous.”

Those pushing austerity during the last three years have been economic saboteurs, pure and simple. Whether it be for political reasons or just defending a career spent churning out unrealistic models, these people have pushed policies that have led to real suffering. It is no time to whine about damaged pride.

No, we do not want austerity. But we have to remember that money alone is not going to give us the future we want. When we dismiss the austerians out of hand, we miss the point they are trying to get across: the possibility of real economic setback is always there, and the point remains that try as we might we can’t completely prove that possibility wrong. And if they turn out to be right while we have done too little to expand the definition of wealth, we are in a world of hurt. My point is that we need to build a future that takes their warnings and concerns into serious consideration. We need to reenvision wealth far beyond the limited abilities of money, so that debt is not our only way to grow wealth.
Karl I hope you always keep the courage to say what you feel and listen to the response. There are important bloggers out there who do not want to hear the whole dialogue – and who can blame them – but when they shut the dialogue off (even partially) it can sometimes be hard for them to keep up with the dialogue itself. And Greg, to you I would say, do not be afraid to speak with your very own voice. It is the voice that means the most.

The work Lincoln believed he was in was the TOTAL DEFEAT of the Confederacy.

Similarly the work we are currently in is the total defeat of austerianism and the ideologies that support it. Just as the four humours theory of medicine caused people to be bled to death and therefore was a dangerous theory that had to be discredited, the austerian philosophy and the theories supporting it is causing economies to be bled to death and therefore are dangerous theory that have to be totally discredited.

Yeah that worked for exactly- who? Come on, it’s only when people fight back against bullies that reason can come into the discussion.

I suggest you spend some time reading Eric Alterman’s book “What Liberal Media” to understand the current paradigm.

He doesn’t cover the Economics profession as such but unless you’ve been ignorant of the history of the debates since the Great Depression (and actually before) the profession gets stuck on an almost religious orthodoxy celebrating business at any cost.

“It is this blog’s overarching conceit that none do more harm than those who seek to do a principled good. The selfish will always accept a Coasian bargain. True believers will stop at nothing.”

I think that’s pretty much true, but put much too strongly. I think I’m a good example of a true believer who is also committed to compromise as a principle. The correlation between rabidness of belief and an unwillingness to compromise exists, but it’s weak.

I suppose that we might get away with some sort of belief-in-belief, cognitive dissonance – to put is simply, the influential people act-as-though their policy ideas were destructive folly, whilst still believing that their policy ideas were not destructive folly (note that ‘acting-as-though’ might include public statements that their ideas were folly though, since, e.g, in the case of the Fed or ECB the expectations channel is significant).

I wonder, however, if this doesn’t simply store up problems for the future. Allowing ‘wrongness’ to get spread around for the sake of compromise only means that people in the future will also believe wrong things.

I leave a leave a response each time I like a article on a website or if I have something to add to the conversation. It is a result of the fire
communicated in the article I read. And after this post
A Gentler Krugman | Modeled Behavior. I was actually moved
enough to drop a thought ;) I actually do have a couple of
questions for you if it’s okay. Is it simply
me or does it give the impression like some of these responses come across like they are left by brain dead individuals?:-P And, if you are posting at additional social sites, I would like to keep
up with everything fresh you have to post. Would you list all of your communal pages like your linkedin profile, Facebook page or twitter feed?